We welcome article submissions from experts in the areas of coal, mining,
shipping, etc.
To Submit your article please click here.
|
|
|
Monday, 27 December 10
ANALYSIS: CHINA'S COAL PRODUCTION MISMATCHED WITH DOMESTIC DEMAND
 As reported by iStock Analyst, China's coal market has been trapped in a strange cycle. Large coal production bases are facing overcapacity, while large coal consumption provinces are in short supply of power coal.
This structural contradiction between supply and demand in China's coal market has highlighted heated discussions recently.
Coal producers facing mounting pressure of excess in output capacity
China is facing severe excess of production capacity and oversupply of coal in 2010 due to the expansion of coal production and surging imports amid sluggish demand, and this situation is expected to carry on into 2011 as new coal companies begin operation.
Wang Zhanjun, director-general of the China Coal (TSXV:CKO) Industry Association, said that China's coal supply capacity has seen a remarkable increase in 2010 due to the operation of newly formed coal companies after mergers and acquisitions.
In the first 11 months of 2010, the country's leading coal producing provinces and regions including Shanxi, Inner Mongolia, Shaanxi, and Ningxia all saw more than 20 percent growth in coal output.
According to a report by the association, in the first 11 months of 2010 China's coal output surged 15.5 percent or 418 million metric tons (tonnes) year on year to 3.039 billion tonnes, while coal sales were up 13.5 percent or 390 million tonnes to 2.892 billion tonnes. Coal deliveries increased by 15.3 percent year on year to 1.827 billion tonnes during the same period.
The investment in fixed assets in the coal industry has continued to increase this year. In the first 11 months of 2010, fixed assets investment in coal mining and washing saw 22.7 percent year-on-year growth to 320.7 billion yuan.
Meanwhile, China's coal imports keep rising while exports keep declining. In January-November, China's coal exports dropped 13.5 percent to 17.58 million tonnes, and are expected to remain low in December. Total coal exports are estimated at 19 million tonnes for the whole year.
In sharp contrast to declining exports, coal imports maintained fast growth in 2010. Net imports of coal are expected to reach 145 million tonnes in 2010.
However, China's coal demand has remained sluggish this year. Affected by the measures for energy conservation and emissions reduction, electricity consumption growth of high energy-consuming industries like ferrous metals, chemicals, non-ferrous metals, and building materials has fallen back quickly since May of 2010, which in turn has cut coal consumption severely.
Coal consumption in the steel industry moved from positive growth to negative growth in 2010.
According to official statistics, China's daily crude steel output saw fast growth in the first half of 2010 but registered three months of negative growth in the third quarter, and only increased 4.8 percent in November.
Also, coal consumption in the chemicals industry has also remained sluggish this year. According to preliminary forecasts, coal consumption in the chemicals industry in 2010 will stay at the same level as in 2009, at 140 million tonnes.
The China Electricity Council predicted that electricity demand in China would not increase much in 2010 and 2011, estimating the growth at 10 percent in 2010, 14 percentage points lower than in 2009.
Therefore, coal industry is expected to face mounting oversupply pressure in 2011 since the output of majority coal enterprises would double. Meanwhile, large numbers of coalmines in Shanxi, Henan, Shaanxi, and Inner Mongolia are scheduled to begin operation in 2011, and the coal oversupply will be aggravated by the participation of more downstream firms in power generation and metallurgy, said Wang Zhanjun, head of the China Coal Industry Association.
Wang predicted that coal supply in China would increase 300 million tonnes in 2011, and China would face excess in supply of coal.
Short supply of coal at power plants
In sharp contrast with the excessive output and supply of coal, a number of power plants in parts of China are suffering from shortages of power coal.
In Guizhou province, coal output capacity is significantly less than demand. The local coal output is expected to increase by 160 million tonnes at most in 2011, which would exacerbate the tight supply. This is because the output capacity of newly formed coalmines is inadequate to make up for eliminated production capacity, and the newly formed capacity will not come into operation until the second half of 2011.
At the same time, power plants in Guizhou cannot afford coal produced outside the province because of higher coal prices.
Similar short supply of coal has also occurred in Hubei province. Coal stocks at power plants in Hubei have remained at critical level since the beginning of this year, and sometimes were even not enough for one week's consumption.
The power coal shortage is not only a headache for power plants in non-coal production areas, but also hit power plants in major coal production areas like Shanxi and Henan.
Take the Datang Taiyuan Second Thermal Power Plant for example. The plant has suffered coal shortages four times since the beginning of 2010 because its contracted coal supplier supplied only 400,000 tonnes of coal towards meeting the 1.5-million-tonne coal contract.
As of December 4, power coal stocks of Henan have slid sharply from 3.84 million tonnes at the beginning of November to 2.65 million tonnes, far below the critical level of 3.5 million tonnes.
This has led to a daily supply shortage of 700,000 tonnes. Current coal production system might be primary cause
The short supply of power coal against excess of overall output capacity in China is believed to be caused mainly by system contradictions existing in the coal industry.
Actually, China's coal industry has trapped in a strange circle. Coal demand weakens after power plants stockpile power coal, but after the stockpiling, coal stocks of coal producers are down. Therefore, the coalmines produce more coal, which eventually leads to excess of output and excessive supply of coal.
Some coal suppliers have complained that if they carry on supplying coal according to their coal contracts with the power plants at the contracted price, the coalmines would all suffer (OOTC:WLVTQ) losses while the power plants all make profits.
A senior manager of the Shenhua Group said that it is difficult to avoid the structural contradictions of disjointed coal output and demand under the current government-capped management system. The outlook of China's coal industry remains troubled for 2011, and the problem of excessive output capacity would continue to be widespread in China, especially in western areas.
According to the manager, branches of the Shenhua Group in Xinjiang are all in the red due to heavy coal inventory pressure, while some provinces in east and south China are suffering from severe shortages of coal.
An insider with the Shanxi Coking Coal Group said that the group was ambitiously planning to double its output capacity during the period of the 12th Five Year Plan (2011-15), but the current market environment is very unfavorable for the coal industry. The cost of acquiring small coalmines has spiraled far beyond expectations.
Therefore, the mismatch between coal supply and demand at the turn of the new year is manageable, and the market is expected to see increasing supply and decreasing demand soon, noted the insider.
But Wang Xianzheng expressed disagreement. He believed that China's coal demand would increase by 200 million to 300 million tonnes in 2011. Besides which, the government-planned construction of 10 million units of affordable housing would drive coal demand by 60 million tonnes at least. Wang believed that the coal price would remain buoyant in 2011 but would not rise much.
Source: Quotemedia, Xinhua News Agency (Edited by Li Xiaohui), istockanalyst
If you believe an article violates your rights or the rights of others, please contact us.
|
|
Sunday, 23 January 11
THE AVERAGE CHARTER RATE FOR CAPE SIZE VESSELS WAS AT $ 8,859 PD ALMOST CLOSE TO 2008 LOWS - VISTAAR
COALspot.com - The BDI continues to drop and saw a drop of about 5 pct this week closing at 1,370 points. “ In May 2010 the BDI touched ...
Saturday, 22 January 11
POSSIBLE COAL EXPORT RESTRICTIONS ON INDONESIA UNLIKELY TO AFFECT CHURCHILL MINING - PROACTIVE INVESTORS
Proactive Investors reported that, Churchill Mining moved to reassure investors after a fall in its share price, stating that from talks with the au ...
Thursday, 20 January 11
INDONESIA MAY BAN LOW-QUALITY COAL EXPORTS FROM 2014 - BLOOMBERG
Bloomberg reported that, The Indonesian government plans to ban exports of coal with an energy value of less than 5,600 kilocalories a kilogram star ...
Thursday, 20 January 11
SUPRAS ARE DOING USD 7- 8K FOR INDONESIA-INDIA - FEARNBULK
Handy
Negative sentiment for forward positions in the Atlantic market due to lack of cargo availability and too many ballasters from the East. Con ...
Thursday, 20 January 11
ITMG TARGETS TO PRODUCE 25 MILLION TONS OF COAL THIS YEAR - BISNIS INDONESIA
Bisnis Indonesia reported that, Coal producer PT Indo Tambangraya Megah Tbk (ITMG) targets to produce 25 million tons of coal this year, a 13. ...
|
|
|
Showing 5416 to 5420 news of total 6871 |
|
 |
|
|
|
|
| |
|
 |
|
|
| |
|
- Heidelberg Cement - Germany
- Central Java Power - Indonesia
- Antam Resourcindo - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Vizag Seaport Private Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Semirara Mining Corp, Philippines
- Kumho Petrochemical, South Korea
- Eastern Energy - Thailand
- Bukit Baiduri Energy - Indonesia
- Manunggal Multi Energi - Indonesia
- GAC Shipping (India) Pvt Ltd
- Simpson Spence & Young - Indonesia
- Aboitiz Power Corporation - Philippines
- Rashtriya Ispat Nigam Limited - India
- London Commodity Brokers - England
- CNBM International Corporation - China
- Meenaskhi Energy Private Limited - India
- Timah Investasi Mineral - Indoneisa
- Directorate General of MIneral and Coal - Indonesia
- Malabar Cements Ltd - India
- Bukit Asam (Persero) Tbk - Indonesia
- Renaissance Capital - South Africa
- Bhushan Steel Limited - India
- Videocon Industries ltd - India
- Orica Mining Services - Indonesia
- Dalmia Cement Bharat India
- Latin American Coal - Colombia
- Offshore Bulk Terminal Pte Ltd, Singapore
- SN Aboitiz Power Inc, Philippines
- Global Business Power Corporation, Philippines
- Ambuja Cements Ltd - India
- Carbofer General Trading SA - India
- Port Waratah Coal Services - Australia
- Makarim & Taira - Indonesia
- Thiess Contractors Indonesia
- Ministry of Transport, Egypt
- Marubeni Corporation - India
- San Jose City I Power Corp, Philippines
- Bangladesh Power Developement Board
- Siam City Cement PLC, Thailand
- ICICI Bank Limited - India
- Kohat Cement Company Ltd. - Pakistan
- Kartika Selabumi Mining - Indonesia
- Altura Mining Limited, Indonesia
- Minerals Council of Australia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Ministry of Mines - Canada
- Planning Commission, India
- Savvy Resources Ltd - HongKong
- Banpu Public Company Limited - Thailand
- Interocean Group of Companies - India
- Neyveli Lignite Corporation Ltd, - India
- Jindal Steel & Power Ltd - India
- Siam City Cement - Thailand
- Riau Bara Harum - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Anglo American - United Kingdom
- Chamber of Mines of South Africa
- Price Waterhouse Coopers - Russia
- Pendopo Energi Batubara - Indonesia
- Coastal Gujarat Power Limited - India
- Electricity Generating Authority of Thailand
- Edison Trading Spa - Italy
- Vedanta Resources Plc - India
- South Luzon Thermal Energy Corporation
- Global Coal Blending Company Limited - Australia
- Leighton Contractors Pty Ltd - Australia
- Singapore Mercantile Exchange
- Medco Energi Mining Internasional
- Wilmar Investment Holdings
- Essar Steel Hazira Ltd - India
- Central Electricity Authority - India
- Miang Besar Coal Terminal - Indonesia
- Jaiprakash Power Ventures ltd
- Coalindo Energy - Indonesia
- Kobexindo Tractors - Indoneisa
- European Bulk Services B.V. - Netherlands
- Indogreen Group - Indonesia
- Sakthi Sugars Limited - India
- Karaikal Port Pvt Ltd - India
- Holcim Trading Pte Ltd - Singapore
- Ind-Barath Power Infra Limited - India
- Romanian Commodities Exchange
- Baramulti Group, Indonesia
- Indika Energy - Indonesia
- Commonwealth Bank - Australia
- Tata Chemicals Ltd - India
- Chettinad Cement Corporation Ltd - India
- Jorong Barutama Greston.PT - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Energy Development Corp, Philippines
- Energy Link Ltd, New Zealand
- IHS Mccloskey Coal Group - USA
- Iligan Light & Power Inc, Philippines
- Gujarat Electricity Regulatory Commission - India
- Aditya Birla Group - India
- New Zealand Coal & Carbon
- Ministry of Finance - Indonesia
- Merrill Lynch Commodities Europe
- Sree Jayajothi Cements Limited - India
- Global Green Power PLC Corporation, Philippines
- Metalloyd Limited - United Kingdom
- Uttam Galva Steels Limited - India
- Intertek Mineral Services - Indonesia
- SMC Global Power, Philippines
- Borneo Indobara - Indonesia
- Coal and Oil Company - UAE
- Agrawal Coal Company - India
- Georgia Ports Authority, United States
- Mjunction Services Limited - India
- Australian Coal Association
- Pipit Mutiara Jaya. PT, Indonesia
- Directorate Of Revenue Intelligence - India
- Barasentosa Lestari - Indonesia
- The University of Queensland
- OPG Power Generation Pvt Ltd - India
- Globalindo Alam Lestari - Indonesia
- Bhoruka Overseas - Indonesia
- Sindya Power Generating Company Private Ltd
- Electricity Authority, New Zealand
- Power Finance Corporation Ltd., India
- Salva Resources Pvt Ltd - India
- Semirara Mining and Power Corporation, Philippines
- GMR Energy Limited - India
- Sinarmas Energy and Mining - Indonesia
- Formosa Plastics Group - Taiwan
- India Bulls Power Limited - India
- Standard Chartered Bank - UAE
- Billiton Holdings Pty Ltd - Australia
- Cigading International Bulk Terminal - Indonesia
- Xindia Steels Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Larsen & Toubro Limited - India
- Indo Tambangraya Megah - Indonesia
- Samtan Co., Ltd - South Korea
- Therma Luzon, Inc, Philippines
- Gujarat Mineral Development Corp Ltd - India
- PetroVietnam Power Coal Import and Supply Company
- Kaltim Prima Coal - Indonesia
- IEA Clean Coal Centre - UK
- Tamil Nadu electricity Board
- VISA Power Limited - India
- Kapuas Tunggal Persada - Indonesia
- Sojitz Corporation - Japan
- Meralco Power Generation, Philippines
- Petron Corporation, Philippines
- Australian Commodity Traders Exchange
- White Energy Company Limited
- Thai Mozambique Logistica
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Goldman Sachs - Singapore
- Economic Council, Georgia
- Posco Energy - South Korea
- Africa Commodities Group - South Africa
- Independent Power Producers Association of India
- Sical Logistics Limited - India
- Grasim Industreis Ltd - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- TeaM Sual Corporation - Philippines
- Cement Manufacturers Association - India
- MS Steel International - UAE
- Parliament of New Zealand
- Lanco Infratech Ltd - India
- Straits Asia Resources Limited - Singapore
- Mercator Lines Limited - India
- Bukit Makmur.PT - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Alfred C Toepfer International GmbH - Germany
- Indian Energy Exchange, India
- International Coal Ventures Pvt Ltd - India
- Orica Australia Pty. Ltd.
- Trasteel International SA, Italy
- PNOC Exploration Corporation - Philippines
- CIMB Investment Bank - Malaysia
- Toyota Tsusho Corporation, Japan
- Deloitte Consulting - India
- LBH Netherlands Bv - Netherlands
- Madhucon Powers Ltd - India
- Bulk Trading Sa - Switzerland
- GVK Power & Infra Limited - India
- Wood Mackenzie - Singapore
- Bhatia International Limited - India
- Karbindo Abesyapradhi - Indoneisa
- Binh Thuan Hamico - Vietnam
- Mintek Dendrill Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Maheswari Brothers Coal Limited - India
- Sarangani Energy Corporation, Philippines
- AsiaOL BioFuels Corp., Philippines
- Kalimantan Lumbung Energi - Indonesia
- Bayan Resources Tbk. - Indonesia
- The State Trading Corporation of India Ltd
- Kepco SPC Power Corporation, Philippines
- PowerSource Philippines DevCo
- Attock Cement Pakistan Limited
- Krishnapatnam Port Company Ltd. - India
- Ceylon Electricity Board - Sri Lanka
- The Treasury - Australian Government
- Indian Oil Corporation Limited
- PTC India Limited - India
- Star Paper Mills Limited - India
- ASAPP Information Group - India
- Bharathi Cement Corporation - India
- Parry Sugars Refinery, India
- McConnell Dowell - Australia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Oldendorff Carriers - Singapore
- Maharashtra Electricity Regulatory Commission - India
- Eastern Coal Council - USA
- Rio Tinto Coal - Australia
- Mercuria Energy - Indonesia
- Indonesian Coal Mining Association
- Kideco Jaya Agung - Indonesia
- SMG Consultants - Indonesia
- Gujarat Sidhee Cement - India
- GN Power Mariveles Coal Plant, Philippines
|
| |
| |
|
